It’s no secret that China is not happy with the US fiscal situation. They are rightly worried about the future of the US Dollar and are looking for ways to limit the accumulation of even more dollars. They recently agreed to a currency swap with Argentina and are now in discussions with Brazil about a similar arrangement:
Brazil and China will work towards using their own currencies in trade transactions rather than the US dollar, according to Brazil’s central bank and aides to Luiz Inácio Lula da Silva, Brazil’s president.
The move follows recent Chinese challenges to the status of the dollar as the world’s leading international currency.
It is sad to say, but China is responding to this crisis much better than the US.